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Commission to tackle unemployment

President calls on employers and government to increase hiring

Ryan Dagur, Jakarta

December 4, 2012

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President Susilo Bambang Yudhoyono has established a taskforce aimed at finding ways to curb unemployment and to give incentives to employers to hire additional people.

The committee, which will be led by the coordinating minister for economic affairs, Hatta Radjasa, was formed in a limited cabinet meeting yesterday.

”We realize that there is a need to reduce unemployment and poverty rates,” the president said in a statement published on the Cabinet Secretariat website.   

Indonesia has a 6.2 percent unemployment rate. The committee has been tasked with lowering it to five percent, the president said.  

“I ask everybody to grab the momentum of high economic growth and continue to slash the level of poverty and unemployment,” Yudhoyono said. Indonesia’s six percent growth rate is the second highest of the G-20 nations, second only to China at 7.4 percent.

The president also stressed the importance of job security by calling on company owners, central and local governments and workers associations to prevent new waves of unemployment.

The initiative comes just weeks after the government increased the minimum wage by 44 percent so that workers in Jakarta will earn US$229/month as of next year.

The decision triggered protest from business people who threatened to shut down several companies.

Committee leader Hatta Radjasa said that with existing robust economic growth at six percent, the government can create about 500,000 new jobs.

The government has also offered tax breaks for businesses that create new jobs, he said.

Said Iqbal, chairman of the Indonesian Workers Confederation, welcomed the government initiative but pointed out that employers must offer decent wages.

“Whatever measure is taken by the government, it must refer to the principle of mutual benefit,” he said. 

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